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Tullow Oil Ltd is incorporated in Dublin so seems technically possible. It is a box ticking exercise so maybe they cant fudge it!
"there is a chance of defaulting within 5 months"
no chance of defaulting now we have $1bn liquidity headroom !
Although I expect we have to wait until January voluntary redetermination to be sure we clear the 2020/21 Financial Statements qualification. II's would begin to return then?
Thank you Slift. I was confused by the news article on this page today...
'The London-based independent oil & gas group said it completed the sale of its assets in Uganda to French oil major Total for USD500 million, with a further USD75 million due after production commences.'
To be received on FID or on production. Something changed?
Wonder how and when the shorts linked to the repayment of the $300m debt will close.
If the $500m is in the bank tomorrow and committed to the $300m debt, would all those linked shorts try to close tomorrow? Is that a material number?
'could tlw negotiate moving the repayment dates and continue to service interest? S&P says we are stable'
I imagine Rahul looking at this option. The $575m could then be used to sustain earnings/ increase hedges etc and perhaps underpin growth in a 'Rahul inspired Venture'?
showing his teeth again on the one minute chart
Think the shorts bought at 24 on the news last week and started selling again to bring it down. Yesterday looks like they bought again so I wont be surprised if it drops again. Fortunately the news is good so I will be holding whilst they open and close.
Moody's 'Key rating considerations are summarized below'..$500m in the bank shortly.
The B3 corporate family rating of Tullow Oil plc ("Tullow") is underpinned by its sizeable oil and gas asset portfolio located in Africa, including low cost production offshore Ghana (B3 negative) and significant resources in Uganda (B2 stable) and Kenya (B2 negative), albeit likely to be monetised in the near future. The rating also reflects Tullow's inherent exposure to the volatility in oil prices and high concentration of production in Ghana, which results into some linkage between its ratings and the sovereign rating of Ghana. In late 2019, operational issues encountered at the Jubilee and TEN fields in recent years led Tullow to revise downward its guidance for medium-term production and cash flow outlook. While conservative financial management (including a prudent hedging programme) helps underpin the cash flow resilience of the group, an extended period of low commodity prices is likely to leave it free cash flow negative. In this context, the timely execution of the $1 billion asset disposal programme launched in late 2019 will be key to reduce Tullow's heightened leverage and strengthen its liquidity profile.
https://www.moodys.com/research/Moodys-announces-completion-of-a-periodic-review-of-ratings-of--PR_422203
My guess is the 2021 balance sheet improves additional $0.5bn on $60 oil and long term price oil $60.
Will improve a further $XBn if long term price of oil increases additional $X and so impaired assets reinstated.
Depends what happens to Kenya end of 2021 also
The general direction has been:
Rebuild trust and move toward a more conservative balance sheet.
Reduce the asset portfolio by $1Bn and use proceeds as required.
POO might mean increasing hedging costs to service debt/improve credit risk.
2021 debt is covered by the UG $500m and the $500m RBL facility will be reviewed in January 2021 to underpin the strategy from CMD.
So its down to 'Mr 13%' and other material interest groups to broker deals out of CMD.
Africa and RoW could be sold separately. Alternatively, small steps to bolster the current model so that marginal revenue always = marginal cost and wit for POO to recover and flow through increased earnings.
Moody's 'Key rating considerations are summarized below'
The B3 corporate family rating of Tullow Oil plc ("Tullow") is underpinned by its sizeable oil and gas asset portfolio located in Africa, including low cost production offshore Ghana (B3 negative) and significant resources in Uganda (B2 stable) and Kenya (B2 negative), albeit likely to be monetised in the near future. The rating also reflects Tullow's inherent exposure to the volatility in oil prices and high concentration of production in Ghana, which results into some linkage between its ratings and the sovereign rating of Ghana. In late 2019, operational issues encountered at the Jubilee and TEN fields in recent years led Tullow to revise downward its guidance for medium-term production and cash flow outlook. While conservative financial management (including a prudent hedging programme) helps underpin the cash flow resilience of the group, an extended period of low commodity prices is likely to leave it free cash flow negative. In this context, the timely execution of the $1 billion asset disposal programme launched in late 2019 will be key to reduce Tullow's heightened leverage and strengthen its liquidity profile.
https://www.moodys.com/research/Moodys-announces-completion-of-a-periodic-review-of-ratings-of--PR_422203
If an RNS for the $500m in TLW bank lands tomorrow, does it follow Moodys can improve the credit rating. That would be good news before CMD next month.
The $500m must meet much, if not all that Moodys have published is reviewed to rerate. Rahul would want as many investors as possible engaged. Moodys rerate would help?
SP should increaee again on that news?
'Its a case of Tullow clearing payment of $15M to Uganda Government. Then Tullow getting $500M plus $15M from Total. The $15M business is probably done. The payment of $500M might take a bit more time to clear and transfer across.'
Think the the treasury functions could have had this lined up for a while given the size of payment. Might only need a couple of 'signatories' this weekend and RNS monday?
The turnaround included $1bn portfolio management to get a 'conservative' balance sheet.
Rahuls cmd and January redetermination should make it clear what 'conservative' capital structure tlw wants going forward.
Continuing to deliver production guidance and hedged/ higher oil suggests we have a clear run in 2021 which is a fantastic platform for the strategy options. Having options is a great place to be.
Its not a stock for the average pensioner. But its not a pension scam either. Volume is in the control of the shorts and they have to close. TLW is not going bust.
'Last person at the bar pays the bar bill'
Disagree with..
'This is not a investing share. This is a traders share. This is going the same way as PMO.'
If you cant visualise the current managements capability then you cant see the potential of CMD, the January determination supporting the future capital structure including a low cost Kenya in partnership with Total and CNOCC over the next 25 years or more.
15p?? More like £2.50 when the ink is dry imo
Makes me think we will have higher prices/ inflation so they can raise taxes rather than printing money. Like the recent EU carbon footprint tax. Not less oil consumption, more carbon capture.
Think there were environmental checks to complete before tlw discharged and final sign off?
'instant communication over long distances'
.. signalling I suppose?
Wonder if post Brexit we revert to OFTEL and no interference from global regulators (at a distance)